SECTION 7. PAPERWORK

REDUCTION ACT

The collection of information contained in this revenue procedure has been reviewed and approved by the Office of Management and Budget in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under control number 1545–1551. An agency may not conduct or sponsor, and a person is not required to

or improvement of property placed in service before January 1, 1981).

(2) Certain scope limitations inappli- cable . The scope limitations in section 4.02 of this revenue procedure do not apply to a taxpayer that makes this change for its first or second taxable year beginning after December 31, 2011. If the taxpayer makes both this change and a change to a UNICAP method under section 11.01 or 11.02 of the APPENDIX (as applicable) for its first or second taxable year beginning after December 31, 2011, on a single Form 3115 for the same year of change in accordance with section 10.10(4)(a) of this APPENDIX, the scope limitations in section 4.02 of this revenue procedure do not apply to the taxpayer for either change.

(3) Manner of making change . A taxpayer making this change must complete Form 3115, Schedule E and attach it to its Form 3115.

(4) Concurrent automatic change . (a) A taxpayer that wants to make both this change and a change to a UNICAP method under section 11.01 or 11.02 of this APPENDIX (as applicable) for the same year of change should file a single Form 3115 that includes both changes, in which case the taxpayer must enter the designated automatic accounting method change numbers for both changes on the appropriate line on that Form 3115. For guidance on filing a single application for two or more changes, see section 6.02(b)(ii) of Rev. Proc. 2011–14. (b) A taxpayer that wants to make this change and a concurrent change to a method under §§ 1.162–3T, 1.162–4T, 1.263(a)–1T, 1.263(a)–2T, or 1.263(a)–3T with the same year of change should file a single Form 3115 that includes all of the concurrent method changes, in which case the taxpayer must enter the designated automatic accounting method change numbers for all concurrent changes on the appropriate line on that Form 3115. For guidance on filing a single application for two or more changes, see section 6.02(b)(ii) of Rev. Proc. 2011–14. (5) Section 481(a) adjustment . (a) A taxpayer changing to this method of accounting must not include in the § 481(a) adjustment any amount attributable to property for which the taxpayer elected to apply the repair allowance under

§ 1.167(a)–11(d)(2) for any taxable year in which the election was made.

(b) By following the sampling procedures provided in Rev. Proc. 2011–42, 2011–37 I.R.B. 318, a taxpayer changing its method of accounting under this section 10.10 of the APPENDIX may use statistical sampling in determining the § 481(a) adjustment. Sampling methodologies not described in Rev. Proc. 2011–42 are not permitted.

(c) A taxpayer making this change must attach to its Form 3115 a schedule for the section 481(a) adjustment listing the adjustment amounts for each property classification ( e.g ., 5-year property, 7-year property, or nonresidential real property).

(6) Statistical sampling . By following the sampling procedures provided in Rev. Proc. 2011–42, 2011–37 I.R.B. 318, a taxpayer changing its method of accounting under this section 10.10 of the APPENDIX may use statistical sampling to support items on its income tax returns under §§ 1.263(a)–1T and 1.263(a)–3T. Sampling methodologies not described in Rev. Proc. 2011–42 are not permitted.

(7) Ogden copy of Form 3115 required in lieu of national office copy . A taxpayer changing its method of accounting under this section 10.10 of the APPENDIX must file a signed copy of its completed Form 3115 with the IRS in Ogden, UT (Ogden copy), in lieu of filing the national office copy, no earlier than the first day of the year of change and no later than the date the taxpayer files the original Form 3115 with its federal income tax return for the year of change. If a taxpayer makes both this change and a change to a UNICAP method under section 11.01 or 11.02 of this APPENDIX (as applicable) on a single Form 3115 for the same year of change in accordance with section 10.10(4)(a) of this APPENDIX, the taxpayer must file a signed copy of that completed Form 3115 with the IRS in Ogden, UT (Ogden copy), in lieu of filing the national office copy, no earlier than the first day of the year of change and no later than the date the taxpayer files the original Form 3115 with its federal income tax return for the year of change. See sections 6.02(3)(a)(ii)(B) (providing the general rules) and section 6.02(7)(b) (providing the mailing address) of this revenue procedure.

(8) Designated automatic accounting method change number . The designated

April 2, 2012 699 2012–14 I.R.B.

(3) For depreciable or amortizable assets that are mass assets accounted for in multiple asset accounts or pools, a change in the method of identifying which assets have been disposed; and

(4) Any other change in depreciation or amortization as the Secretary may designate by publication in the Federal Regis- ter or in the Internal Revenue Bulletin.

.05 Section 1.446–1(e)(2)(ii)( d )( 3 ) provides, in relevant part, that none of the following changes in depreciation or amortization is a change in method of accounting:

(1) An adjustment in the useful life of a depreciable or amortizable asset for which depreciation is determined under § 167 (other than under § 168, § 1400I, § 1400L(c), former § 168, or an additional first year depreciation deduction provision of the Code (for example, § 168(k), § 1400L(b), or § 1400N(d))). However, if a taxpayer is changing to or from a useful life (or recovery period or amortization period) that is specifically assigned by the Code (for example, § 167(f)(1), § 168(c), § 168(g)(2) or (3), § 197), the regulations thereunder, or other guidance published in the Internal Revenue Bulletin, such a change is a change in method of accounting;

(2) The making of a late depreciation or amortization election or the revocation of a timely valid depreciation or amortization election, except as otherwise expressly provided by the Code, the regulations thereunder, or other guidance published in the Internal Revenue Bulletin;

(3) Any change in the placed-in-service date of a depreciable or amortizable asset, except as otherwise expressly provided by the Code, the regulations thereunder, or other guidance published in the Internal Revenue Bulletin; and

(4) Any other change in depreciation or amortization as the Secretary may designate by publication in the Federal Regis- ter or in the Internal Revenue Bulletin.

.06 Section 1.446–1(e)(2)(ii)( d )( 5 )( iii ) provides that except as otherwise expressly provided by the Code, the regulations thereunder, or other guidance published in the Internal Revenue Bulletin, no § 481(a) adjustment is required or permitted for a change from one permissible method of computing depreciation or amortization to another permissible method of computing depreciation or amortization for an asset. Instead, this

respond to, a collection of information unless the collection of information displays a valid OMB control number.

The collections of information in this revenue procedure are in section 4. This information is necessary and will be used to determine whether the taxpayer properly changed to a permitted method of accounting. The collections of information are required for the taxpayer to obtain consent to change its method of accounting. The likely respondents are the following: individuals, farms, business or other forprofit institutions, nonprofit institutions, and small businesses or organizations.

The estimated total annual reporting and/or recordkeeping burden is 9,162.5 hours.

The estimated annual burden per respondent/recordkeeper varies from ¹ /4 hour to 8 ¹ /2 hours, depending on individual circumstances, with an estimated average of 1 ¹ /4 hours. The estimated number of respondents is 7,330. The estimated annual frequency of responses is on occasion.